Indian Strategic Studies: 08/31/25

31 August 2025

Trump's 50% tariff on India kicks in as Modi urges self-reliance

Nikhil Inamdar

Modi has urged small shop owners and businesses to put up "Made in India" boards outside their stores

US tariffs of 50% on goods from India took effect on Wednesday as Donald Trump sought to punish Delhi for buying Russian oil and weapons.

The tariffs – among the highest in the world – include a 25% penalty for transactions with Russia that are a key source of funds for its war in Ukraine.

India, a vital strategic US partner in the Indo-Pacific, has shown no signs of stopping its purchases, calling the tariffs unfair and vowing to choose the "best deal" on buying oil to protect its 1.4 billion people.

But there are fears exports and growth in the world's fifth largest economy could suffer. The US was, until recently, India's largest trading partner.

The tariff setback has sent the Indian government into firefighting mode.

Earlier this month, Prime Minister Narendra Modi promised to cut taxes to mitigate the impact of the tariffs which will disrupt millions of livelihoods across the country's export-driven industries that supply everything from clothes to diamonds and shrimp to American consumers.

He said a Diwali gift in the form of a "massive tax bonanza" was on its way for the common man and the millions of small businesses that power Asia's third largest economy.

Wearing a bright saffron turban and addressing crowds of spectators from the ramparts of Delhi's Red Fort during Independence Day celebrations, Modi also urged small shop owners and businesses to put up boards of "Swadeshi" or "Made in India" outside their stores.

"We should become self-reliant - not out of desperation, but out of pride," he said. "Economic selfishness is on the rise globally and we mustn't sit and cry about our difficulties, we must rise above and not allow others to hold us in their clutches."

Trump’s Tariffs and India’s Economic Future

Ajay Shah

US President Donald Trump’s new tariffs on India will likely cause some immediate economic damage. But the greater risk is that they will prompt the Indian government to turn inward, when it would be better off seeking new international partners and reaffirming its commitment to the globalized economy that has served it so well.

NEW DELHI – US President Donald Trump’s decision to impose new tariffs on a wide range of imports from India, ostensibly a penalty for buying Russian oil, represents another shock to the international trading system – and a sharp reversal of good relations with Indian Prime Minister Narendra Modi. These tariffs could disrupt the Indian economy, which has benefited immensely from global integration. But the greater risk lies in their potential to influence the country’s long-term strategic direction.

How Pakistan Outplayed India and Won Donald Trump’s Favor

Eldar Mamedov

Can Pakistan parlay its temporary diplomatic success with Trump into a fundamental reset with Washington?

For years, including during Donald Trump’s first term, India sat comfortably in Washington’s good graces. Boasting the world’s largest population as well as a growing middle class, India had endeared itself to the world’s developed economies. Military strategists promoted India’s role as a “net security provider” in the Indo-Pacific region, highlighting its importance as a nuclear-armed bulwark against China.

Pakistan, on the other hand, was not so lucky. As the world’s only Islamic nation to possess nuclear weapons, its image suffered following September 11, 2001. Its support for the Taliban resurgence next door in Afghanistan didn’t help. “Being a friend to Pakistan is a lonely job in this town,” would quip the rare DC foreign policy hand sympathetic to a more balanced South Asia policy.

These attitudes easily carried into the second Trump administration. However, when the President unexpectedly praised Pakistan for counter-terrorism cooperation during his first joint address to Congress, the script began to flip. Pakistan suddenly gained new advocates in Washington.

That alone didn’t shift the balance but did set the stage for Trump’s penchant for personality politics to play an outsize role. When Indian prime minister Narendra Modi launched an attack on Pakistan in May in response to a terrorist attack in Kashmir, which the Indian government alleged was backed by Pakistan, he intended to demonstrate Indian military superiority. However, the gamble partially backfired when Pakistan downed an unclear number of Indian fighter jets in the ensuing dogfights before agreeing to a ceasefire.

However, Modi’s reaction to the end of hostilities seemed to anger Trump: the war had lasted only four days, at least in part, because Trump intervened and urged the parties to de-escalate. Despite its newfound bravado, Pakistan had no interest in entering into a protracted conflict, so it happily took the exit ramp and heaped praise on Trump, adding a Nobel Peace Prize nomination to boot. Trump basked in the glory, while India denied that he had even played a role in peacemaking.

China’s commercial space sector

Henry Boyd, Erik Green, Meia Nouwens

China’s commercial space sector has proliferated over the last decade thanks to political prioritisation and extensive venture-capital funding. Whilst it has not yet fulfilled Beijing’s aim of surpassing the US as a space power, this industry is now a key strength for China.

In 2014, China’s State Council published ‘Document 60’, which opened its space sector to private investment. This decision aimed to establish China as the world’s leading technological and space power by using the private sector to overcome the restraints on innovation and capacity experienced in a state space sector dominated by two state-owned enterprises (SOEs): the China Aerospace Science and Technology Corporation (CASC) and the China Aerospace Science and Industry Corporation (CASIC). The success of SpaceX as a commercial launch provider in the United States and the potential military utility of its Starlink satellite internet constellation have subsequently added additional urgency to the Chinese Communist Party’s (CCP) decision to develop China’s commercial space sector.

Although the immediate growth of the sector after 2014 was slow and mainly driven by spin-offs from SOEs such as Chang Guang Satellite Technology (CGSTL), by the late 2010s the number of commercial companies developing satellites and rocket technology had grown significantly. Today, over 500 commercial space companies exist in China. The increased role of local governments in the sector, utilising financial measures such as loan discounts and venture-capital funds, closely resembles China’s other high-tech and advanced manufacturing sectors. This hybrid of national and local state involvement with bottom-up innovation and profit-making motivations has created a commercial space sector that is currently more diverse, but less mature than its American equivalent.

Launch cadenceAccording to data compiled by astronomer and astrophysicist Jonathan McDowell, China’s new commercial rockets have contributed to a more than threefold increase in annual successful orbital launches between 2015 and 2024. The majority of these launches, however, are still conducted by variants of CASC’s Long March rocket family.

Is It Too Late for the US to Change Its Chip Strategy Toward China?

Dingding Chen and Runyu Huang

The competition between the United States and China over artificial intelligence (AI) and semiconductors is often described as a race, but in practice it looks more like a strategic dance, involving a step forward, a step back, and constant recalibration. For several years, Washington moved aggressively to restrict Beijing’s access to cutting-edge chips, hoping to slow China’s advances in AI and high-performance computing. Yet those sanctions carried unintended consequences: they hurt U.S. businesses, accelerated Chinese self-reliance, and encouraged the emergence of alternative supply chains.

Now, Washington is shifting course. The Trump administration this month approved Nvidia’s H20 chip exports to China under a novel revenue-sharing arrangement, requiring the company to remit 15 percent of sales proceeds to the U.S. government. Trump also signaled openness to allowing the export of downgraded versions of Nvidia’s Blackwell.

This pivot reflected a recognition that total bans may have backfired. The new strategy seeks to keep China tethered to U.S. technology, maintaining leverage through selective dependence.

But is this policy shift too late? The answer, it appears, is yes. Chinese companies have already made notable progress toward independence. Beijing is more cautious than ever about relying on U.S. semiconductors, seeing them as potential vectors of vulnerability. While short-term demand for U.S. chips remains strong, the long-term trajectory points toward a fragmented technological future: the emergence of two parallel AI systems to which states and companies around the world will be forced to adapt.

Washington’s Policy Reversal

The United States’ semiconductor strategy has undergone a quiet but meaningful evolution. In 2022 and 2023, sweeping restrictions targeted China’s access to advanced processors such as Nvidia’s A100 and H100, key components for training large AI models. The move was intended to cut China off from the tools needed to dominate AI, but the impact was more complex.

Why Does China Buy US Farmland?

Rob Pierce

US states should be vigilant about preventing Chinese land purchases close to military installations.

The Chinese Communist Party (CCP) is preparing for conflict with the United States and learning from ongoing wars that are redefining how future battles may unfold. A critical lesson emerging from today’s conflicts is that assets positioned behind enemy lines in peacetime can be activated with devastating effect in wartime.

Israel’s Operation Rising Lion succeeded in decimating Iranian military infrastructure and eliminating senior military leaders not only through superior platforms, munitions, and intelligence, but also through low-cost, unmanned systems launched from within Iran itself. Similarly, in Operation Spider’s Web, Ukraine struck at the heart of Russian airpower using covertly deployed UAVs pre-positioned in Russia, damaging or destroying at least 20 strategic aircraft across five oblasts.

China is undoubtedly studying these operations, recognizing that the ability to operate from within US borders through surveillance, sabotage, or pre-placed systems could prove decisive in a future conflict. These examples should serve as a wake-up call for American policymakers: the Chinese Communist Party’s acquisition of US farmland, including near sensitive military installations, is not merely an economic concern but a strategic threat.

China’s Global Ambitions

The CCP is pursuing a long-term grand strategy to achieve national rejuvenation and displace the United States as the world’s preeminent power. Economically, China aims to entangle the world in its supply chains while racing to dominate critical technologies like AI and quantum computing. Politically, it is striving to erode US credibility, weaken US-led alliances, and reshape global norms to favor autocracy. Militarily, it is building a world-class force capable of challenging US superiority first in the Indo-Pacific, then globally. These efforts are already shifting the balance of power and are guided by a coherent, aggressive strategic worldview that senior Chinese leaders articulate regularly and unapologetically.

China, Japan, and Shifting Narratives of War

Lewis Eves

The recent 80th anniversary of Japan’s surrender at the end of World War II inspired multiple publications on how Japan remembers its wartime history. However, there has been less said about the countries that Japan fought and their historical narratives of the war, nor how these countries’ narratives align with Japan’s understanding of its wartime history.

In particular, China’s understanding of its war against Japan has changed significantly over the decades. Alongside Japan’s changing historical narratives of the war, this has caused a divergence in historical memory that fuels tensions between the two countries – and makes hostility more likely.

China’s Narratives of the War

The Chinese Communist Party (CCP) has encouraged two distinctive historical narratives of the war. The CCP’s governing legitimacy is closely linked with World War II; the Chinese Civil War (1945-49), in which the CCP defeated their political rivals to establish control over China, was born out of World War II. While the CCP did fight against the Japanese invaders, they focused on developing their powerbase while the Kuomintang or Nationalists (who served as China’s wartime government) bore the brunt of China’s war effort. Accordingly, weakened by the war against Japan, the Nationalists were less able to resist communist forces.

The Maoist narrative of the war was dominant in China from the formation of the People’s Republic in 1949 until the early 1980s. It was rooted in communist ideology and blamed the war on a militaristic international bourgeois elite who tricked the Japanese people into a war against China.

At the same time, the Maoist narrative portrayed China’s wartime Nationalist government as incompetent in resisting Japan’s invasion and highlighted the efforts of the CCP’s resistance, particularly those of the Eighth Route Army led by Mao Zedong. This is despite historical records from the war indicating that, out of 23 battles and over 40,000 skirmishes between China and Japan, the CCP’s forces only participated in one and 200 of these, respectively.

What is Key Terrain? Rethinking a Fundamental Military Concept in the Age of Economic Warfare

Benjamin Backsmeier

In an era where economic linkages are global and dense, strategic competition increasingly unfolds in the networks of supply chains, finance, and data rather than purely on physical battlefields. US military doctrine has long emphasized key terrain—ranging from hilltops or river crossings at the tactical level to major features whose control carries operational or even strategic implications such as the Bashi Channel, Fulda Gap, or Strait of Hormuz. But today’s most consequential terrain may be nonphysical: manufacturing dominance in key sectors like semiconductors, assured access to minerals like rare earth elements, control over natural gas infrastructure, or the security of undersea cables. These systems, once considered logistical backdrops, are now central instruments of national power.

As Henry Farrell and Abraham Newman have described with their theory of “weaponized interdependence,” states can increasingly use control over nodes in global networks to extract coercive leverage, shape rival behavior, and compromise operational readiness. For military professionals, recognizing these dependencies as strategic terrain beyond the traditional DIME (diplomacy, information, military, economics) framework is critical to effective planning.

China’s Rare Earth Elements: Strategic Denial in Practice

China’s dominance in the rare earth market offers a textbook example of weaponized interdependence. By controlling more than 85 percent of heavy rare earth processing and nearly 70 percent of global mining output as of 2024, China occupies a central node in the defense-industrial value chain. Rare earths are indispensable in night vision goggles, precision-guided munitions, missile guidance systems, and electric propulsion, placing downstream US defense manufacturers at risk.

In 2010, Beijing restricted exports of rare earths to Japan amid a diplomatic dispute, signaling that access to these inputs was contingent on political compliance. More recently, in 2023 and 2024, China imposed licensing controls on gallium and germanium, key materials for semiconductors and defense applications, raising alarms about strategic vulnerability. The effect is a form of strategic denial: Rather than fight kinetically, Beijing forces rivals into costly diversification efforts, reshaping global investment flows and complicating defense production timelines.

Why Trump shouldn’t open the floodgates to Chinese students

John Mac Ghlionn

Donald Trump has announced he'll allow as many as 600,000 Chinese students into US universities. Image: Twitter

US President Donald Trump shocked even many of his most loyal supporters when he announced that 600,000 Chinese students would be allowed to enter the United States.

It was pitched as “very important” for trade talks and for keeping American universities afloat. But the scale alone should give pause.

If enacted, this would be the single largest wave of Chinese students in American history, far surpassing even the peak of 372,000 during Trump’s first term.

This is not a matter of disliking foreign students or rejecting international education. It is about understanding how the Chinese Communist Party (CCP) uses students as tools of statecraft.

In China, no one simply packs a bag, boards a plane and studies abroad. Students must first receive permission from the CCP. They leave only with the Party’s blessing, and that blessing comes with strings attached.

Once overseas, these students are not free individuals in the way American students imagine. They remain tethered to the state. Their families at home can be pressured, their own futures can be leveraged and their loyalty is monitored.

Beijing knows this and exploits it ruthlessly. Every Chinese student abroad is both an asset and a potential liability. Many simply want an education. But the Party treats them as resources to be tapped when needed.

Some are tasked with reporting on dissidents in exile. Others are pressured into joining so-called “student associations” that function as front groups for CCP influence.

At times, they are asked to gather sensitive research or to funnel home information that appears innocuous but contributes to the Party’s larger intelligence apparatus.

The Real Reason China Hasn’t Invaded Taiwan

Brent M. Eastwood

Key Points and Summary – A Chinese invasion of Taiwan is not imminent, despite constant military rehearsals and bellicose rhetoric. Beijing’s strategy is one of patient deterrence, not immediate conquest.

-The memory of the 1995-1996 Taiwan Strait Crisis, when a U.S. carrier strike group forced China to back down, still looms large.

-Since then, China has built a formidable military to prevent a repeat of that humiliation.

-However, an actual invasion would likely only be triggered by a dramatic shift in Taipei, such as a formal declaration of independence by a new, more defiant political party—a line the current leadership has not crossed.

No, China Will Not Attack Taiwan in the Near Future

The Taiwan question is the biggest issue facing the Chinese military. It drives the Middle Kingdom’s grand strategy and has obsessed leaders for decades. Xi Jinping is no exception. Every military move he makes has implications for future China-Taiwan relations.

An attack to reunify the island with the mainland is always imminent. Xi will be judged by Chinese historians on how well he handles the Taiwan issue. He cannot “lose” the island.

Taiwan has always been considered a wayward renegade province that annoys the Chinese like a bee in a bonnet. Taiwan is seen as rightfully owned by Beijing. Full independence would be a nightmare for the People’s Republic.

I have written that I don’t see China attacking Taiwan anytime soon, though. The Chinese do not do anything quickly without ample strategic foresight. They plod along, simmering with irritation, and always talk a big game. They do rehearse amphibious landings to overthrow the government of Taiwan, but that doesn’t mean an attack will come in the next year or two.

What satellites just discovered in China is alarming military experts

Futura Team

A new satellite discovery near Beijing has rattled military experts worldwide: China is building what could become the largest underground command complex ever constructed. More than a defensive shield, the bunker signals Beijing’s intent to rival the United States militarily and could alter the balance of power across Asia and beyond.

From Cold War roots to cutting-edge strategy

China’s focus on underground facilities isn’t new. Since the 1980s, it has cultivated specialized teams skilled in building bunkers tough enough to withstand even nuclear strikes—drawing inspiration from Cold War strategies once pursued by the Soviet Union and Germany.

But today’s effort takes that idea further. The new complex reflects a strategic shift: rather than relying solely on sheer numbers, China is emphasizing resilience, technology, and continuity of operations under any circumstances.

Key features reportedly include: fortified command hubs, secure communications resistant to cyberattacks, nuclear survival capacity, and infrastructure designed to keep operations running even during catastrophic strikes.

The construction of this Chinese underground fortress risks fueling a spiral of mistrust and competing military investments. © vadimrysev, iStock

Redefining Asia-Pacific security

This “fortress beneath Beijing” changes the equation in the Asia-Pacific. It gives China a major tactical advantage—ensuring its leadership could maintain command and control through almost any conventional assault.

For regional neighbors like Japan, South Korea, and Australia, the project raises alarms. Analysts warn it could fuel an arms race across Asia. Meanwhile, Washington faces a strategic puzzle: reinforce its presence in the region and invest in bunker-busting technologies, or risk ceding a psychological and tactical edge.

Without Return and Justice, Armenia-Azerbaijan Peace Deal Cements Tragedy for Nagorno-Karabakh Armenians | Opinion

Artak Beglaryan

On August 8, Armenian Prime Minister Nikol Pashinyan and Azerbaijani President Ilham Aliyev joined President Donald Trump at the White House to sign a joint declaration. That same day, the foreign ministers of both countries initialed a long-negotiated agreement on peace and inter-state relations.

Together, the declaration and agreement were hailed as a long-awaited diplomatic breakthrough: recognition of borders, renunciation of territorial claims, a ban on the use of force, and new connectivity projects—including the Trump Route for International Peace and Prosperity (TRIPP).

For diplomats, it looked like success. For the 150,000 Christian Armenians of Nagorno-Karabakh (Artsakh)—ethnically cleansed and fully displaced in 2020 and 2023—it looked like a disappearance. Nowhere in these texts is there a single reference to the primary victims of this conflict, a people who lived in their ancestral homeland for millennia.

What the Peace Framework Ignores

The agreement emphasizes sovereignty, borders, and good-neighborly relations. Symbolically, it even condemns intolerance, hatred, and extremism. But it never names the displaced Armenians, never sets conditions for our safe return, and never acknowledges the destruction of our homes, churches, and cemeteries under Azerbaijani occupation.

Instead, the declaration speaks of "closing the chapter of enmity" and rejecting "revenge"—while ignoring the fact that Azerbaijan emptied Nagorno-Karabakh of Armenians through blockade, bombardment, and fear. That reality has been described as genocide by the International Association of Genocide Scholars, by Juan Méndez, the U.N.'s first special adviser on the prevention of genocide, and by Luis Moreno Ocampo, the International Criminal Court's first prosecutor. Meanwhile, Freedom House, the European Parliament, and many other institutions have called it ethnic cleansing. Notably, President Donald Trump himself publicly recognized that "Armenian Christians were horrifically persecuted and forcibly displaced in Artsakh" on October 23, 2024.

US Military Redeployment in Iraq: Strategic Withdrawal or Tactical Shift?

Dr. Mohamed ELDoh

The sudden US decision to pull out its forces from the Ain al-Asad and Victoria bases in Iraq and redeploy them to Erbil and possibly to a neighboring Arab country amounts to a significant change in US military posture in the Middle East. Despite the optics of a “withdrawal,” the move is actually a careful reorientation intended to strike a new balance between the security demands of maintaining strategic influence and the operational risks inherent to domestic politics and regional tensions. Understanding the objectives, underlying drivers, and expected outcomes of this repositioning can help shed some light on the broader framework of US defense strategy in the Middle East going forward.

The Objectives of US Repositioning

Washington’s primary objective is to maintain its influence in Iraq while protecting its troops from escalating geopolitical risk in the Middle East. By withdrawing from Ain al-Asad and Victoria, two bases frequently targeted by Iran-backed militias with drones and rockets, the US reduces the vulnerability of its forces to asymmetric attacks. Along with protecting troops, this risk management lowers the political costs of an exchange that leads to casualties, which would fuel tensions between Washington and Baghdad and potentially entangle Washington in new conflicts.

Another rationale is to deny Tehran the tactical and symbolic advantage of attacking US military targets in central and western Iraq. Such attacks on US facilities in Baghdad or Anbar highlight US vulnerability and bolster Iran’s resistance narrative. By removing these high-value targets, Washington hopes to prevent Iranian propaganda victories while preserving operational flexibility.

Managing Iraqi Political Pressures While Preserving Erbil’s Strategic Reach

In Iraq, Prime Minister Mohammed Shia’ al-Sudani is facing increased pressure from the parliament and some segments of the populace to end the “foreign military presence.” If Washington agrees to withdraw from Ain al-Asad and Victoria, some of this pressure would be alleviated. The US maintains a discreet but effective presence in Erbil and other locations, which helps the local government maintain some degree of autonomy. The resulting formula mitigates tensions with the central government while still maintaining operational capability.

It’s Not Too Late to Fix the U.N.

Suzanne Nossel

The United Nations is in crisis. Secretary-General António Guterres has mandated 20 percent across-the-board spending cuts, amounting to more than $700 million. The proximate cause of the pinch is the United States’ clawback of around $1 billion in allocated funds, doubts over Washington’s future contributions, and, to a lesser extent, other nations’ retrenchments and practice of routinely paying dues late.

The crisis is not solely financial. Under President Donald Trump, the United States—which drove the U.N.’s founding—has turned its back on liberal internationalism. Washington has withdrawn from key U.N. agencies, suspended financial obligations to these bodies, and put the rest of its funding commitments to the organization under review. The U.N. has endured decades of U.S. pendulum swings, but this time is different: Trump is drastically reshaping Washington’s stance toward the world in ways that won’t easily be undone. The emergence of alternative multilateral bodies, great-power deadlocks, and global reductions in development assistance all threaten the U.N. in its current incarnation.

Russia’s reckoning is coming

Peter Caddick-Adams

Beyond the bluster of his meeting with President Trump, Vladimir Putin is in trouble. Isolated, outmanoeuvred, and stalled on the battlefield, Russia is tottering financially and militarily, while Zelensky's Ukraine continues to hold the upper hand.

Summits have become the common currency of international diplomacy. Think of Kennedy and Khrushchev at Vienna in 1961; Nixon and Mao Zedong in China, 1972; Reagan and Gorbachev in Reykjavik, 1986; or Trump and Kim Jong-Un at Singapore in 2018. In between, key meetings of NATO, the G7, EU, WEF, OPEC, the Commonwealth, or of BRICS Western-sceptic nations have also rejoiced under the moniker of summits.

The ease of long-haul air travel means there are many more gatherings of these alphabet soups than there used to be, but Winston Churchill, with his sense of history, was aware they were nothing new. He wrote about the Congress of Vienna, that ran from September 1814 to June 1815, attended in person the January to June 1919 peace negotiations at Versailles, and organised key encounters with Roosevelt and Stalin between 1941 and 1945.

The more significant they are to the world, the more summits require huge stage-management, massive preparation, and exhaustive face-time, still making them relatively rare beasts. Like London buses, none are witnessed for ages, then suddenly three appear. Recently, the world was treated to a Trump-Putin encounter to ‘solve the Ukraine question’ at the Elmendorf-Richardson US military base in Anchorage, Alaska, on 15 August. This was followed rapidly by a gathering of six NATO, EU and European leaders, plus Prime Minister Starmer and President Zelensky at the White House on 18 August to ‘correct Trump’s perceived pro-Moscow tilt’.

To thrash out the desires of their political masters, on 20 August, Italian Admiral Cavo Dragone, chair of NATO’s Military Committee, summoned the alliance’s 32 defence chiefs to a digital summit to consider America’s initiatives to end the Moscow-Kyiv antagonism and possibly put boots on the ground in Ukraine. The jury is out on the wisdom of a peacekeeping force. Back in the 1990s, NATO’s Bosnian commitment, with which I served, required at its height more than 60,000 personnel from 32 nations. Generals reckon that Ukraine, a much larger entity, could absorb 500,000, and with risks of an armed showdown with Russia, it would be a mission too far.

Divesting the Past to Secure Tomorrow’s Battlefield

Benjamin Fernandes and Benjamin Jensen

Secretary of Defense Pete Hegseth gave the Army a clear directive—design a leaner and more lethal force with better long-range precision fires, air and missile defenses, cyber capabilities, electronic warfare, and counter-space capabilities. These are expensive priorities requiring significant changes to the Army’s force structure. The Army cancelled the M10 Booker and procurement of older attack helicopters (AH-64D Apache) but plans to develop a new manned tank; however, Army leaders should consider substantial divestment of manned attack aviation and manned tanks. Generals and soldiers, including the authors, love Apache attack helicopters and M1 Abrams tanks, which represent raw combat power and U.S. technological dominance of the twentieth century. However, today’s anti-access/area denial (A2/AD) threats, proliferating advanced air defenses, and other threats in every domain demand rethinking the Army’s force structure at every level. Winning modern combat requires lethal, relatively cheap, strategically agile (i.e., between continents), and tactically agile (i.e., on the battlefield) weapon systems that industry can quickly produce in large numbers. Agility becomes especially important in an unpredictable world where threats and the president determine where the Army operates, not the Army’s desire or force structure. The next adversary could be cartels, China, or something else.

Abrams and Apaches Lack Strategic Mobility

While the Abrams tanks and Apache helicopters provide tremendous lethality on the battlefield, their slow movement between continents overly burdens the force with poor strategic mobility. A C-17 cargo aircraft can only carry one Abrams tank because it weighs more than 30 Ford F-150 trucks. Apache helicopters are easier to carry; three fit on a C-17, but loading and unloading remain relatively slow and cumbersome due to the disassembly and reassembly required. These physical requirements force the Army to rely on sealift, which easily requires 30 or more days to transport equipment to Europe, Asia, or the Middle East. Chinese, Russian, Iranian, and North Korean investment in cyber (e.g., Volt Typhoon), long-range fires (e.g., Oreshnik), and anti-ship capabilities (e.g., DF-21 anti-ship missile) could substantially lengthen this strategic transportation timeline and attrit forces in transit under wartime conditions. Compounding this problem are some tactical, intra-continental mobility concerns for the Abrams, such as its ability to cross most bridges due to its weight and massive logistics requirements—around a half-mile per gallon of fuel. Ultimately, adversaries could achieve a fait accompli or, more likely, substantial gains before a critical mass of Abrams or Apaches arrive on the battlefield.

The Russia Oil Surcharge: Anticipating the Benefits and Challenges

Clayton Seigle

This Commentary builds on the previously proposed surcharge mechanism designed to drive Russian oil revenues lower. In short, the U.S. government would impose a fee on Russia’s oil customers, like India, in exchange for waiving strong new secondary tariffs.

This approach is designed to isolate Moscow’s revenues in isolation: without trying to sink global oil prices (bad for U.S. industry economics) and without removing large Russian volumes from the market that would risk a price spike (bad for the fight against inflation).

This analysis addresses three key considerations arising from our proposal to maximize U.S. leverage to end the war in Ukraine.

Consideration 1: Eroding Russia’s Spending Power to Pressure Putin

With 7.3 million barrels per day (mb/d) of oil exports and prices around $64 per barrel, Russia earned about $467 million per day, or $14 billion from its oil sales during the month of July. How much of a revenue reduction is needed to change behaviors in Moscow?

A new shortfall of $40–50 billion will apply significant stress to Russia’s remaining financial sources and erode its current account surplus. An initial $20 per barrel surcharge that effectively caps Russian revenues around $45 could achieve this target. Here’s how:

Russia faces a mushrooming budget deficit—during the first seven months of 2025, it had already reached $61.1 billion, exceeding the full-year budget by a quarter, as wartime spending continues apace and oil revenues have come in below expectations. Western policymakers should target a further revenue cut of about $50 billion to further widen the deficit and apply stress to Moscow’s financial coping mechanisms.

Russia’s budget has two important lifelines to supplement oil and gas revenues: the National Welfare Fund (NWF) and debt issuance. Faced with low oil revenues, Moscow has resorted to both sources to preserve adequate war funding. The more Washington and its allies can reduce Russia’s oil revenues, the more Moscow will be forced to drain the NWF and increase indebtedness to perpetuate military spending—and these lifelines are not without limits.

The Case for a Ceasefire in Ukraine

RICHARD HAASS

NEW YORK – “Ripeness is all” opined Edgar in Shakespeare’s King Lear. Everyone would do well to keep this in mind amid diplomatic efforts to end the war between Russia and Ukraine.

Rarely in history is one side able to end a war merely by imposing its will on the other. In nearly all cases, what makes a given conflict ripe for progress, even resolution, is the presence of leaders who opt for an accord over continued fighting, who are strong enough at home to maintain support for that stance, who endorse a formula involving some benefits for all, and who accept a mutually acceptable diplomatic process to achieve these aims.

Today, the obvious question about the Russia-Ukraine war is whether these elements can be identified. While US President Donald Trump has made peace a priority, it is difficult to be optimistic. Russia occupied Crimea and parts of Ukraine’s eastern Donbas region in 2014, and three and a half years of renewed fighting that commenced in February 2022 have produced little change to the map. The only peace that can be imagined will have to be negotiated, not imposed.

Diplomatic prospects are especially unripe when it comes to Russia. President Vladimir Putin is probably strong enough to sell an end to the war at home, although he would have to explain why so many lives were sacrificed for less than total victory. But he is not yet inclined to do so, because he believes he is better off without an agreement and that time is on his side. His goal is not more territory per se, but rather the end of Ukraine as an independent democratic country with close ties to the West, and he has not shown any willingness to settle for anything less. Nor is it clear that a process that Russia will accept currently exists; revealingly, the Kremlin is throwing up roadblocks to a meeting between Putin and Ukrainian President Volodymyr Zelensky.

Forget Rearmament: Germany Needs to Focus on Unmanned Weapons

Brandon J. Weichert

There is no way that Germany will be able to achieve its existing mobilization and rearmament goals as currently stated—but cheap and effective naval drones could provide an alternative.

With Russia committed to full-scale war in Ukraine and sizing up NATO territory in eastern Europe, Germany has committed itself for the first time in 80 years to total rearmament. Berlin’s rearmament push aims to meet the North Atlantic Treaty Organization’s (NATO) minimum two percent of national Gross Domestic Product (GDP) defense spending target—though Berlin thinks it can get to 3.5 percent by 2029—and to modernize the Bundeswehr into Europe’s largest and most capable.

Indeed, Berlin plans to expand active-duty personnel to 240,000 by 2031. Its budget for Fiscal Year 2025 prioritizes advanced systems—and in particular focuses on naval enhancements, anticipating a showdown with the Kremlin in the Baltic Sea. Recent investments include an €800 million contract for Type 212A-class submarine upgrades by ThussenKrupp Marine Systems (TKMS), incorporating new combat systems and autonomy features, for instance.

All of this is laudable—at least on paper. But Germany has been one of the hardest hit victims of the Ukraine War. Following the mysterious destruction of the Nord Stream 2 pipeline—since linked to Ukraine’s intelligence services, with NATO’s likely involvement in some capacity—Germany’s energy prices have soared, stagnating its economy. As a result, when Berlin makes noise about strengthening its military, it is using money that it does not really have. And its defense industrial base is in no shape to take on Russia’s—which, recall, can produce in three months what it takes all of NATO, including the United States, a year to build.

The one area, however, where Germany might enjoy some success is with the rapid development—and deployment of—unmanned systems.

The Gambler Maschineblau-FLANQ Development Deal

Israel’s leadership vacuum risks disaster in looming UN vote on Palestinian state

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This September, the United Nations is expected to take up the issue of recognizing Palestine as a member state. For Israel, this moment is not just another diplomatic skirmish—it is a strategic test with potentially far-reaching consequences. Yet Prime Minister Benjamin Netanyahu and his fractured coalition seem paralyzed, trapped in endless internal fights while offering no coherent vision for Israel’s future. Instead of advancing a plan, Netanyahu is gambling on improvisation and Washington’s veto pen. Such complacency risks turning a manageable challenge into a full-blown diplomatic disaster.

Recognition of Palestine is no longer a fringe cause. More than 140 nations already recognize a Palestinian state, and momentum is building within Europe and beyond. Even if full UN membership remains blocked at the Security Council, a General Assembly vote would carry enormous symbolic and political weight. It would strengthen Palestinian claims in international forums, embolden hostile campaigns such as boycotts and sanctions, and further delegitimize Israel’s standing in the eyes of many nations.

Netanyahu’s response so far has been depressingly predictable: condemnations of “one-sided moves,” reliance on the U.S. veto, and fiery rhetoric aimed at his domestic base. But this is not strategy—it is stagnation. By defaulting to rejectionism without offering any credible alternative, Israel cedes the diplomatic initiative and reinforces the global perception that it has no interest in shaping a just and sustainable peace.

The leadership vacuum in Jerusalem is glaring. Netanyahu is consumed by his corruption trial, the survival of his coalition, and his campaign to neuter Israel’s judiciary. His ministers are more preoccupied with culture-war battles and pandering to their constituencies than with foreign policy. As the Palestinian Authority advances its recognition drive with growing international sympathy, Israel projects the image of a state divided, defensive, and adrift.

Surrender Ukrainian Land? Ask the Army

Elena Davlikanova

The President of Ukraine is not the President of Russia. That’s more than just a truism — it cuts to the heart of what makes a young democracy different from a despotic regime.

It also explains why President Zelenskyy has far more limited options than the Kremlin when negotiating a peace settlement or an armistice. While he has already made it clear that, as head of state, he will not yield to Putin’s extravagant demands, the international pressure remains high. His rejection of the idea is not simply because he regards the Kremlin’s demands as tantamount to capitulation; Putin may be able to order his army to pull back, and is certainly able to suppress any popular dissident this might cause, but for Ukraine, it’s very different.

Popular consent is a central issue for Ukraine’s government. Three-quarters of Ukrainians reject Russia’s maximalist demand that they surrender currently unoccupied land for peace, polls show. Having suffered huge casualties — perhaps approaching half a million dead and seriously wounded — Ukraine’s government has to consider not just the approach of Russia, the US, and its European allies, but also its own people.

There is another consideration barely mentioned in the Western debate about Ukraine and its options, and that’s the view of the army. With as many as a million (mostly) men under arms, the Ukrainian Armed Forces are a critical and powerful constituency. It is their blood that has been shed and their friends who have been killed and maimed. It is UAF units that would have to withdraw from the fortress cities of the Donbas to less favorable ground.

So it was notable when Ukraine’s drone commander, the outspoken Colonel Vadym “Magyar” Brovdi, published a video statement warning of the consequences of such a move. He argued that the war will not end this year, and that Ukrainian forces are positioned to force Russia into negotiations on Kyiv’s terms later on. His words were ominous — any deal regarded as unfair by the military may trigger a backlash, he said. “No one in the world could bend an army of a million.”

The New Hamas Insurgency

Leila Seurat

On August 18, Hamas accepted a new cease-fire proposal for the war in Gaza. The deal, which had just been presented by Egypt and Qatar and closely echoed earlier proposals shaped by the United States that Israel had backed without approving, called for the release of ten of the remaining 20 living Israeli captives in exchange for a 60-day truce. Unlike previous such proposals, Hamas did not request any changes to the document and accepted it within hours. So far, Israel has not accepted the proposal.

Many observers have interpreted Hamas’s immediate endorsement as a sign of weakness, if not desperation. In this reading, after nearly two years of unremitting Israeli bombardment and siege of Gaza, the assassination of Hamas’s top leaders, and devastating attacks on the group’s allies around the region, including Iran and Hezbollah, Hamas has few options left.

But Hamas’s rapid acceptance of the deal may be as much a strategic ploy as a symptom of duress. After nearly two years of war, Hamas’s political organization has suffered severe blows and its remit over war-torn Gaza is tenuous. Yet despite the growing devastation of Gaza, Hamas’s fighters have shown continued strength. Since the spring of 2025, they have stepped up offensive attacks on Israeli forces across the strip, including a large-scale assault on an Israeli base on August 20, and other operations in June and July in which multiple Israeli soldiers were killed. At the same time, they have increased coordination with other armed groups in Gaza and replenished their ranks, even amid the widespread starvation of the population. Behind Hamas’s resilience is an evolution in its approach to the war that has further raised the stakes and that could make Israel’s controversial new campaign to seize Gaza City a military, as well as humanitarian, disaster.

SHOCK FROM BELOW

Putin’s Play for Time

Alexander Gabuev

In the lead-up to the summit between U.S. President Donald Trump and Russian President Vladimir Putin in Alaska this month, things did not look good for Ukraine. Characterizations of the summit oscillated between a “new Yalta,” in which the U.S. president might agree to the Kremlin’s demands for a Russian sphere of influence over Ukraine, and a “new Munich,” in which Trump would throw Ukraine under the bus and withdraw U.S. support for the country’s defense. In other words, expectations in Ukraine and among Kyiv’s allies were low.

Yet the summit didn’t end in a major disaster for Ukraine. Trump didn’t negotiate with Putin on Kyiv’s behalf; he didn’t agree to start normalizing relations with Russia before the war in Ukraine was resolved; and on August 18, he received Ukrainian President Volodymyr Zelensky and a phalanx of European leaders at the White House, where they collectively managed to throw the diplomatic ball back into Putin’s court. “This was very much a day of team Europe and team U.S. together supporting Ukraine,” Finnish President Alexander Stubb said afterward.

But although Putin now knows that his aspirational Plan A, in which Trump would simply impose a deal on Kyiv written in Moscow, is unlikely to materialize, he has shifted to his more workable Plan B, in which Trump will lose patience and significantly reduce U.S. assistance to Ukraine. In the Kremlin’s calculus, this still counts as winning, and Putin’s diplomatic strategy is still following the three-pronged approach that my co-authors and I outlined in Foreign Affairs a few months ago. Moscow is holding the U.S. president’s attention, forestalling a new round of painful U.S. sanctions, and keeping the fighting going.

This is because, in the Kremlin’s assessment, time is on Russia’s side. Moscow has the upper hand on the battlefield: it has maintained a significant numerical advantage in personnel and equipment, and despite mounting casualties, it has continued to gradually gnaw through the fortified lines in the Donbas. Moreover, Russia is catching up in drone warfare, denying Ukraine its competitive edge. Moscow doesn’t want a cease-fire to stop the war right now—unless, of course, all of its political demands are simply met.

What Western security guarantees for Ukraine might look like

LUKE COFFEY

After President Trump’s high-level meeting at the White House last week with President Zelenskyy and several European leaders, attention has turned to what security guarantees for Ukraine might look like if a peace deal is reached. Ukraine remains understandably wary of assurances that sound strong on paper but prove meaningless in practice. The 1994 Budapest Memorandum—under which Ukraine gave up the world’s third-largest nuclear arsenal in exchange for promises later violated by Russia in 2014—remains a cautionary tale.

The most effective way to guarantee Ukraine’s long-term security is NATO membership. But in the short term, President Trump has repeatedly stated that he does not support this idea, nor will he agree to U.S. troops on Ukrainian soil. With this political reality in mind, policymakers should consider a layered approach to guaranteeing Ukraine’s security. No single measure is sufficient, but together they would provide the most robust protection currently possible.

The first step would be to establish a civilian monitoring mission that can patrol both sides of a line of occupation, should a peace agreement leave Russian troops on Ukrainian soil. For credibility, it would need to be led by an organization that both Ukraine and Russia could accept. The Organization of Turkic States or the Gulf Cooperation Council might be viable options, as both aspire to play larger geopolitical roles. While such a mission would not resolve all disputes, it could help stabilize a fragile ceasefire and reduce the risk of renewed hostilities.

The second element would be the creation of a European coalition of the willing—that is, European governments willing to send troops to Ukraine to serve as a deterrent and as a visible demonstration of their commitment to its sovereignty. Several countries, including the UK, France, Canada, and Türkiye, have suggested they could contribute forces. Deployments could be rotational, positioned away from the line of occupation but along likely (future) invasion routes. In addition, the coalition should establish an air policing mission to secure Ukraine’s skies, operating from bases in Poland and Romania. Maritime patrols in the Black Sea would also be essential. A secure and open Black Sea is vital not only for Ukraine’s economy but also for broader regional stability.

The Tradeoffs of AI Regulation

Raghuram G. Rajan

When it comes to managing new technologies and financial innovations, the United States tends to regulate too little, too late, whereas the European Union does too much, too soon. Neither gets the balance quite right, which is why the world may be best served if US and European regulators keep pulling in different directions.

CHICAGO – The problem with European regulators, a German businessman recently told me, is that they are too scared of downside risks. “In any innovative new business sector, they overregulate and stifle any upside potential.” In contrast, he argued, Americans care more about the upside potential, and thus hold off on regulation until they know much more about the consequences. “Not surprisingly, the United States has much more of a presence in innovative industries.”

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